Tag Archives: erin murphy

Budget pieces slowly begin moving toward governor’s office

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Rep. Paul Marquart

By Don Davis

Minnesota legislators have taken baby steps in passing a $38 billion, two-year budget that must be finished by midnight Monday.

The biggest step so far was set to come late Friday or early Saturday as the House edged toward approving money for state-subsidized health programs, the second-largest part of the state budget.

“I think we have time to get the budget bills done,” House Majority Leader Erin Murphy, DFL-St. Paul, said even as Republicans complained that the Legislature was debating nonbudget bills.

“I’m concerned that with the amount of time left in the legislative session, we may not have enough time for public input and debate on these important bills,” said Sen. Bill Ingebrigtsen, R-Alexandria.

Budget bills headed for Gov. Mark Dayton’s approval fund public safety, judiciary, higher education and economic development programs.

Much of the budget still was being negotiated among the Democratic-controlled House and Senate and Democratic governor’s office, including measures to fund natural resources, agriculture, public schools, various state agencies and transportation.

Some of the budget became clearer Friday. Murphy said she doubted gasoline taxes would rise, as some proposed. She also said legislative pay likely will not be increased.

A bill raising $2 billion in taxes remained in negotiators’ hands late Friday, but Dayton and legislative leaders gave them instructions to raise income taxes on the highest-paid Minnesotans, add a sales tax to some business services and raise cigarette taxes.

The House began a debate late Friday to fund state health programs for the elderly and disabled.

Supporters of nursing homes and other long-term care organizations said the health and human services bill averts a crisis.

The bill increases nursing home funding 5 percent in the first year of the next budget cycle and 1.5 percent in the second year.

Still, long-term care supporters say the work is not over to find sustainable funding for years to come.

“Every year that we put off discussions and decisions on sustainable long-term care funding will only make the problem more difficult to solve,” President Gayle Kvenvold of Aging Services of Minnesota said. “The state’s current funding approach is already strained.”

Earlier Friday, the House defeated a plan to spend $800 million on public works projects across the state. The vote was 76-56, but bills funded by the state selling bonds need 81 votes.

House Minority Leader Kurt Daudt, R-Crown, said the bonding bill and a proposed constitutional amendment that filled Friday afternoon are “distractions” from setting the state’s budget. The constitutional amendment would remove the decision about legislators’ pay from the Legislature.

The House plans to take a break from the budget for a time Saturday, perhaps a long time.

Nearly 100 amendments have been filed for a bill to allow child care providers and personal care attendants to join unions. There were fewer amendments than that when senators debated the bill, a debate that stretched 17 hours before it passed 35-32.

Murphy said she will use “all of the tools in the toolbox” to shorten debate if Republicans venture into filibuster territory instead of what she considers legitimate debate.

Rep. Jason Metsa, DFL-Virginia, sponsored the legislative pay amendment.

“This isn’t a bill about giving legislators a pay raise,” he said. “It is about being transparent.”

Daudt said there was no need to take up the bill this year because Metsa’s plan calls for voters to consider the measure in 2016, leaving three more legislative sessions where it could be debated.

Daudt and other Republicans raised their voices during the pay debate.

“Uff-da. I think the caps lock was on there,” Murphy said.

Divide remains between rural Republicans, House leaders

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Murphy, Marquart

By Danielle Killey

House Majority Leader Erin Murphy and Rep. Paul Marquart stood side-by-side Tuesday introducing House Democrats’ education funding plan.

Murphy, DFL-St. Paul, praised Marquart’s work as education finance chairman: “He has done such a fantastic job.”

Indeed, politics can make unexpected allies.

Marquart, DFL-Dilworth, had challenged Murphy to lead the House Democratic-Farmer-Labor caucus after last November’s elections. Rep. Paul Thissen of Minneapolis was elected House speaker, and Marquart said he wanted to make sure rural Minnesota was represented in leadership.

Marquart lost the leadership contest, but said he was pleased to land the job as education finance chairman. His committee decides the budget for the state’s largest spending area.

Marquart said he was relieved when he saw many other rural members named to committee leadership spots as well, allaying some concerns about a lack of input from greater Minnesota that many members outside the Twin Cities metropolitan area raised as the legislative session began.

“I thought, ‘here’s where the balance is,’” Marquart said.

Some rural lawmakers still are not convinced.

“I think we’re left behind, definitely,” Rep. Debra Kiel, R-Crookston, said of rural Minnesotans under Democratic budget plans.

She said the proposals do not address real needs outside the Twin Cities area and could hurt small businesses and farmers.

“I think they need to re-examine their priorities,” Rep. Rod Hamilton, R-Mountain Lake, said of Democrats. “I definitely have concerns.”

Many rural Republican lawmakers cited recent approval of the environment and agriculture finance bill, which included water usage fee increases, an example of plans they say will disproportionately impact greater Minnesota.

Before the legislative session began, Republican lawmakers said agriculture funding would be overshadowed by other issues when it was joined with environment and natural resources for finance talks, and they were not happy with the result.

The bill passed without any Republican votes.

“I think this is one of the first times we have had a lack of bipartisan support there,” Rep. Paul Anderson, R-Starbuck, said. “I just don’t think this is a common-sense approach to how things work in rural Minnesota.”

Murphy said Democrats intentionally aimed for significant rural committee leadership overall to ensure those voices would be heard and said the budget plan reflects that.

“I think Minnesota as a whole will experience the benefits,” Murphy said. “We pay a lot of attention to different areas of the state.”

“We said we’re not going to play games with the budget anymore,” Marquart said. “That leads to balancing it on the backs of rural Minnesota often.”

Marquart said those Republicans concerned about rural Minnesota should look at the difference from the past two years, when the GOP controlled the Legislature.

“Rural Minnesota took a hit,” Marquart said. “We reversed some of those things.”

“I think the overall budget is excellent for rural Minnesota,” he added, citing his education finance bill, property tax relief and a 3 percent increase in funding for nursing homes. “I would say, look at the results.”

Thissen said a possible public works borrowing bill also would include funding toward important projects in rural Minnesota.

Kiel acknowledged some rural cities might see more state funds from changes to Local Government Aid and property tax relief plans. But she said proposed alcohol and cigarette taxes, the water fee increases, education requirements and other policies would cost more than any benefit those communities might see.

“Even if we raise LGA, we’re going to turn around and spend it and charge more money,” she said.

Kiel said other Democratic proposals such as raising the minimum wage will hit rural Minnesota harder than the metro as well. “That’s going to be detrimental to businesses.”

Leaders “truly think they’re trying” to keep rural Minnesota in mind, Kiel said.

Murphy grew up around agriculture and said she has farmers in her family. She said she understands the ag industry’s strength is essential to the state’s success.

But top concerns are different from rural to metro areas, Kiel said, and it is hard to advocate for both.

“If everything’s a priority, nothing’s a priority,” Hamilton said.

Marquart said he thinks Thissen and other leaders have “made a concerted effort to make sure the results are beneficial for rural Minnesota.”

“We know if greater Minnesota succeeds, we’ll all succeed,” Thissen said.

Hamilton said the final results of the session remain to be seen in the last few weeks, and Democratic leaders still will be in place next year, the second of a two-year legislative session.

More policy issues likely will come up then, Anderson said, and the impacts on the state outside the metro area might be clearer.

“There could be a lot more issues that are near and dear to rural Minnesota,” Anderson said. “It’s kind of a two-year trial here.”

 Reporter Don Davis contributed to this story.

Legislative notebook: Transportation debate centers on bike lane parking

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By Don Davis and Danielle Killey

Minnesota Senators approved a bill 48-19 Tuesday that sets state transportation policies over some rural lawmakers’ concerns about a provision banning parking in bicycle lanes.

“Bike lanes are not standard throughout the state,” Sen. Eric Pratt, R-Prior Lake, said.

He said many of the lanes outside the Twin Cities metro area are along the edge of roads and blocking them would eliminate the bulk of parking options. Members unsuccessfully tried to amend the provision to only apply in Minneapolis.

Transportation and Public Safety Committee chairman Scott Dibble said allowing parking defeats the purpose of the bicycle lanes as a safe route for riders.

“A vehicle parked in that lane can create extremely dangerous situations,” he said.

Some lawmakers wondered why various transportation projects in their areas were not included.

“I am reluctant to stick those specific projects in statute,” Dibble, DFL-Minneapolis, said.

Sen. David Tomassoni, DFL-Chisholm, did add an amendment to the transportation bill  requiring the re-routing plan for U.S. Highway 53 near Virginia, Minn., to be one of two generally accepted paths rather than a third, referred to as the westerly option.

Tomassoni said that route would skip some towns in the area and make many trips along the road longer, including for emergency vehicles, school transit and business access.

The road must be moved because a mining company that owns the land plans to use it..

Lawmakers also accepted an amendment that would keep speeding violations on Interstate 35E in St. Paul from downtown to West Seventh Street off driving records if drivers are ticketed for going less than 10 miles per hour over the limit.

The speed limit there is 45 mph, and lawmakers have worked for years to raise it.

The bill also names Officer Tom Decker Memorial Highway along Minnesota Highway 23 and clarifies some state laws, such as that school bus drivers are prohibited from operating cell phones when the bus is on the road, even if it is stopped.

Health bill passes

Minnesota representatives spent more than nine hours debating how to spend $13 billion on health programs in the next two years.

“This budget reflects the priorities of Minnesotans,” House Majority Leader Erin Murphy, DFL-St. Paul, said during debate that ended late Monday. “We have to keep steady pressure on this area of the budget.”

Democratic legislative leaders ordered a $150 million cut in the budget, most of which funds health programs for the elderly, disabled and poor. Rep. Tom Huntley, DFL-Duluth, wrote into the bill an added surcharge on Minnesota hospital receipts to help fill in for the cut.

Republicans complained that the bill did too little to help nursing homes, despite a 3 percent funding increase with 75 percent of the new money going to employee raises.

House Minority Leader Kurt Daudt, R-Crown, summarized reaction to the DFL-written bill: “I’m stunned.”

“Democrats are handing out more money in every single budget area except this one, except human services,” Daudt said.

A few amendments were added to the bill, including one on a 71-62 vote that would require abortion clinics to be state licensed. Supporters said it is needed to keep patients safe.

Drug test lawmakers

Minnesota representatives voted to test themselves for drugs and alcohol.

On a 119-12 vote, they agreed with Rep. Tina Liebling, DFL-Rochester, that lawmakers should be tested “to the extent practicable” and must provide evidence of a negative test before receiving any pay or expense reimbursements.

Representatives tacked the provision onto another amendment by Rep. Steve Drazkowski, R-Mazeppa, that would require such tests before Minnesotans receive welfare payments.

The Drazkowski amendment, with lawmaker provision attached, passed 83-49. It was on an overall health-care funding bill.

While representatives approved the provisions, they are not included in Senate or Gov. Mark Dayton proposals.

The full health care funding bill, spending $13 billion the next two years, passed late Monday.

Update: Tax routes outlined

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Hann

By Danielle Killey

Minnesota lawmakers now have three distinct tax proposals to consider with release of a Senate Democratic plan that includes an income tax hike, sales tax changes and property tax relief.

Senate Democrats unveiled a proposal Tuesday that would increase income tax for married Minnesota couples who make about $141,000 or more taxable income. They also would lower the sales tax rate while expanding what is taxed to include clothing and other goods and some services.

The proposal does not create a new income tax bracket, like the governor’s and House’s proposals, but would increase the top tax rate from 7.85 percent to 9.4 percent. That would bring in $1.2 billion of the $1.8 billion new revenue the state would net under the total tax plan.

“When this bill becomes law, we will accomplish the goals of the session, to balance the budget over the next four years,” Tax Committee Chairman Rod Skoe, DFL-Clearbrook, said.

Minnesota has a projected $627 million deficit for the next two years and lawmakers want to boost education and other spending.

The third tier change would affect about 6 percent of Minnesota taxpayers directly, Skoe said.

The plan would reduce the state sales tax more than a percentage point and tax clothing and other goods and services. It is a scaled-down version of a sales tax proposal Democratic Gov. Mark Dayton made, then dropped in the face of strong legislative and public opposition.

“The philosophy was really to modernize the tax system,” Skoe said. “This matches the purchasing patterns of Minnesota.”

“It’s bringing stability to the sales tax system,” Sen. Ann Rest, DFL-New Hope, said.

Lower income earners would get a credit on their income taxes to help offset the clothing tax cost, Rest said.

Skoe proposes increasing the cigarette tax, also included in the House and governor’s plans. The Senate bill does not include an alcohol tax House members propose.

Skoe’s plan includes updates to the Local Government Aid formula and more state money for cities, counties and townships. It would eliminate state sales taxes cities and counties pay.

“We’re trying to attack property taxes at the source” with the changes, Skoe said. “I think there’s significant property tax relief in here.”

Republicans said the bill would hurt middle class Minnesotans.

“This is not a tax on the wealthy, it’s a tax on everybody,” Senate Minority Leader David Hann, R-Eden Prairie, said. “Before we raise another dime in taxes from Minnesotans, we should be going line-by-line through our state budget and cut wasteful government spending.”

House Majority Leader Erin Murphy, DFL-St. Paul, said there is not much support for the Senate tax bill among House Democrats.

“There is a lot of support for the proposal we put forth,” she added, which she said was drawn up after talking to Minnesotans.

The House bill would create a fourth tier rate of 8.49 percent for couples making more than $400,000 a year in taxable income and add a temporary surcharge on couples’ income more than $500,000.

The governor’s plan would tax couples making more than $250,000 at 9.85 percent.

Sen. Julianne Ortman, R-Chanhassen, said Democrats have sold their income tax increase as only affecting the wealthy, but the Senate proposal does more than that.

“To the extent that there was an effort to tax the rich, I think this is not it. This is a failure,” she said. “It’s a huge imposition on middle class taxpayers.”

Skoe said fellow Democrat senators had questions, but the plan generally was well received.

“It will pass,” Rest said.

 Reporter Don Davis contributed to this report.

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These are some highlights of the bill.

– Third tier income tax rate increase to 9.4 percent from 7.85 percent; affects married couples making $140,960 or more taxable income

– Lower sales tax rate to 5.675 percent from 6.785 percent while taking more

– Increase the current $1.23-cent cigarette tax by 94 cents per pack

– $80 million more in Local Government Aid, $40 million more in county aid and $5 million for township aid

– Greater Minnesota internship program tax credit established

Senate Democrats eye higher taxes on $140,000 and more income

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Skoe

By Danielle Killey

Married Minnesota couples who make about $140,000 or more taxable income would pay higher income taxes under a tax plan offered by senators today.

The proposal does not create a new income tax bracket, like the governor’s and House’s proposals, but would increase the top tax rate from 7.85 percent to 9.4 percent. That would bring in about $1.2 billion.

“This is the bill that is going to balance the state budget,” Tax Committee Chairman Sen. Rod Skoe, DFL-Clearbrook, said.

The plan would reduce the state sales tax to 5.7 percent from 6.87 percent and tax more items and services, such as clothing. Skoe also proposed increasing the cigarette tax to 94 cents per pack.

Republicans said the bill would hurt middle class Minnesotans.

“This is not a tax on the wealthy, it’s a tax on everybody,” Senate Minority Leader David Hann, R-Eden Prairie, said.

House Majority Leader Erin Murphy, DFL-St. Paul, said there is not much support for the Senate tax bill among House Democrats.

“There is a lot of support for the proposal we put forth,” she said, which she said was drawn up after talking to Minnesotans.

The House bill would create a fourth tier rate of 8.49 percent for couples making more than $400,000 a year in taxable income and add a temporary surcharge on couples’ income more than $500,000.

Skoe said he wants the committee to vote on the bill Wednesday, the same day the full House is expected to debate its tax plan.

House expects long health debate

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Huntley

By Don Davis and Danielle Killey

At least 600,000 more Minnesotans would get subsidized health care under a bill House Democrats expect to pass late tonight or early Tuesday.

Republicans complain that even with increased spending for nursing homes and other long-term care programs, more money is needed.

The House health and human services bill spends nearly $11 billion in the next two years, the second most in state government, only behind public school education. Most of the spending would go to fund health programs for the elderly, disabled and poor.

DFL Reps. Tom Huntley of Duluth and Tina Liebling of Rochester said no individual should see a cut in state-funded health care, but Huntley said some hospitals would take a hit.

To make up for a $150 million cut House leaders ordered in his health bill, Huntley added a surcharge on hospitals to cover much of the cut.

The surcharge would be used to match federal funds that would go to some hospitals. However, Huntley said, the federal money would not cover the surcharge at all hospitals.

“Unfortunately, there are winners and losers,” Huntley said.

Democrats said that their bill adds coverage to many Minnesotans.

“We also improved MinnesotaCare,” Huntley said.

The state-subsidized health insurance program would expand to include Minnesotans with incomes 138 percent to 200 percent of the federally assigned poverty rate.

The poor who earn more than twice the poverty rate could be eligible for federal assistance under new federal health laws.

A highlight of the Huntley bill is raising nursing home and other long-term care program payments 3 percent, allowing them to give wage increases to workers for the first time in four years. Given his budget limitations, Huntley said, that was the most he could fit in, but added that he personally would like to give workers 10 percent raises.

Rural Minnesota Republicans called on Democrats to up funding in the health and human services budget plan, especially for nursing homes.

“It’s very, very difficult to stomach what it’s going to do to the nursing home industry,” Sen. Julie Rosen, R-Fairmont, said of the proposal. “We have a crisis out there in rural Minnesota.”

Rep. Paul Torkelson, R-Hanska, said nursing home advocates say current law would be better for them than the proposed budget bill.

Torkelson said there are some funding increases in the House bill, but “they’re crumbs, frankly.”

“Every area in the (state) budget got an increase except health and human services,” Torkelson said, adding Democrats need to evaluate their funding priorities.

“We all need to pull together and properly fund this area,” Rep. Rod Hamilton, R-Mountain Lake, said. “It’s the right thing to do.”

The rural lawmakers said they will push for a bigger pay increase for caregivers.

Sen. Gary Dahms, R-Redwood Falls, said many facilities might have to close or could lose good employees if they face cuts or do not get more funding from the state.

“That is simply just not acceptable,” he said.

House Majority Leader Erin Murphy, DFL-St. Paul, said that Republicans had the chance to increase health spending two years ago when they controlled the House and Senate.

Fee increases bother GOP in ag-outdoors bill

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Corrects DNR and PCA budget figures from earlier version of story

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By Danielle Killey

Republican lawmakers said an environment and agriculture budget bill the House approved 69-61 Thursday is loaded with too-high fees and wasteful spending.

“This agriculture and environment finance proposal is loaded with staggering fee increases that will impact hardworking taxpayers in every income bracket,” said Rep. Denny McNamara, R-Hastings.

Bill author Rep. Jean Wagenius, DFL-Minneapolis, said the money will help manage water issues throughout the state, stem the spread of invasive species and fund agriculture programs.

“These fees are not nearly as damaging as has been indicated, and in fact are needed and they’re necessary to protect our air and water and the health and safety of the people,” said Rep. Tom Anzelc, DFL-Balsam Township.

A major concern among many lawmakers was water usage fee increases. They would add up to between about 75 cents and $4 a year for a household and about $2 to $6 per acre for the average farmer, said Wagenius, the House Environment, Natural Resources and Agriculture Finance Committee chairwoman. That would raise about $6.1 million a year.

“Farmers are facing substantial increases in this bill when it comes to water and fees,” said Rep. Rod Hamilton, R-Mountain Lake.

Democrats argued that the money is needed to protect water in the state and that funding and resources have lagged in the past.

“We’ve all assumed the water in our state is an infinite resource,” Wagenius said, “but our water, particularly our water underground, has its limits, and we’re seeing those limits right now.”

Those who opposed the overall bill said it would negatively affect homeowners, businesses and especially farmers. They pointed to permitting, mining and other fee increases, saying they would add up and negatively affect Minnesotans.

“This bill really increases fees on a lot of people, a lot of businesses,” said Rep. Paul Anderson, R-Starbuck.

Some said the budget plan could push companies out of Minnesota.

“The fees in this bill give small businesses just one more reason to relocate to North Dakota,” said Rep. Deb Kiel, R-Crookston.

Democrats said the bill should show they understand the importance of rural Minnesota.

“It confirms the priorities of the DFL majority to make strong investments in agriculture that will benefit our farmers and our entire state,” said House Majority Leader Erin Murphy, DFL-St. Paul.

The bill would allot $67 million for the Minnesota Department of Agriculture, about $478 million for the Department of Natural Resources and about $171 million for the Pollution Control Agency, among other departments.

The proposal also would create a silica sand technical assistance team to help local governments dealing with the issue.

Republicans said some proposed spending is unnecessary. For example, $300,000 is set aside for bee habitats, many noted, including $50,000 earmarked for signs and public awareness. Some acknowledged the bee population is suffering but said there are better ways to spend the money.

After brief discussion, Sen. Jason Isaacson, DFL-Shoreview, withdrew an amendment putting a five-year moratorium on wolf trapping — from when the animal came off the endangered species list last year — and a four-year moratorium on taking wolves in the Boundary Waters Canoe Area.

A Senate committee approved a wolf hunting and trapping ban earlier in the session, but it has not moved forward since then. The state’s first wolf hunting season ended in January.

State senators are slated to discuss their version of the budget bill today.

House DFL outlines tax plan

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By Danielle Killey

House Democrat leaders say they need to raise taxes on the richest Minnesotans’ incomes, alcohol and cigarettes to fund top priorities.

The extra $2.5 billion in revenue they would gain from new or expanded taxes would go to pay back state money owed to school districts and fund key areas such as early childhood and higher education, job creation and property tax relief, legislative leaders said Monday.

“Those critical investments are not free,” House Speaker Paul Thissen, DFL-Minneapolis, said.

Lawmakers also have to fill a $627 million projected deficit for the next two years.

House Majority Leader Erin Murphy, DFL-St. Paul, said a mix of new revenue, reforms and some cuts will pay for Democrats’ spending priorities, which she said some Republicans share.

The House Democrats’ tax plan would create a fourth tier income tax rate of 8.49 percent for couples making more than $400,000 a year in taxable income, up from the current top rate of 7.85 percent.

The plan also would create a two-year surcharge on couples’ income more than $500,000. That surcharge would be 4 percent of any income above $500,000. Democrat leaders emphasized the extra charge would “blink off” after two years.

“Our plan will make historic investments in education and pay for them responsibly and fairly by asking big corporations and the wealthiest Minnesotans to pay their fair share,” Murphy said. “We’re using all the tools available to us to get Minnesota on better financial footing.”

Gov. Mark Dayton and the Senate also likely will include higher taxes on top earners, though the rates and incomes differ. Support for the surcharge, however, is not strong outside the House.

Thissen said the proposed alcohol tax increase, expected to bring in roughly $350 million over two years, would be on wholesale products but essentially would equate to about 7 cents per beer, 47 cents per bottle of wine and $1.58 on a bottle of liquor.

Smokers would see a $1.60 per pack cigarette tax increase, pushing the tax to $2.83 per pack and likely bringing the state more than $400 million. Gov. Mark Dayton’s plan ups the tax by 94 cents.

Republican Rep. Greg Davids of Preston, former tax committee chairman, said the alcohol and cigarette taxes are problematic because they disproportionately affect low-income taxpayers.

The House plan does include some cuts, such as to the Health and Human Services budget.

“I think Minnesotans expect a balanced approach,” Thissen said.

Republicans said the plan will hurt Minnesotans and businesses.

“This proposal would force massive job-killing tax increases on our business owners and devastating regressive tax hikes on the poorest of the poor,” Davids said.

The House plan does not include changes to the sales tax, though the Senate proposal likely will. Dayton originally proposed expanding the sales tax to include more goods and services, such as clothing, and lowering the overall rate. But that provision was erased when he revised his plan.

The net revenue of the House tax plan would be about $1.5 billion, Thissen said.

About 1 million Minnesotans would see property tax relief under the plan, which includes a reworked renters’ credit and a homeowner’s refund, Democrats said.

The bill also would eliminate corporate tax loopholes for profits held overseas and put funds toward projects at the Mall of America, 3M and Mayo’s proposed Destination Medical Center.

Thissen said he expects the tax bill will be before the full House next week.

Legislative notebook: House OKs jobs bill

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By Danielle Killey and Don Davis

House members approved a jobs bill 75-57 Monday that funds job training, tax cuts for employers and other economic development measures.

Investing in jobs and economic development are top priorities for Minnesotans, House Majority Leader Erin Murphy, DFL-St. Paul, said. “So much of our future is based on that.”

The budget target for jobs spending increased by more than 50 percent over that of the last budget, bill author Rep. Tim Mahoney, DFL-St. Paul, said. It was the first overall budget bill of the session to get a vote by the full House, after about five-and-a-half hours of debate.

At $139.75 million, the bill includes about $5 million more than the governor’s recommendation for Department of Employment and Economic Development.

The bill has $20 million for the Minnesota Investment fund and $18.5 million for the Job Creation Fund, both DEED job creation efforts. It also would fund a job skills partnership designed to train current workers when a business wants to expand or add new technology.

Under the bill, “there is no question the money will be there” for people seeking job training, Mahoney said.

It also includes a controversial provision allowing locked-out employees to collect unemployment for the duration of the lockout, up to three years.

“The impetus of the provision is really about compassion,” Rep. Joe Atkins, DFL-Inver Grove Heights, said.

Some Republicans said the lockout provision is problematic.

“That totally shifts the negotiating balance between business and labor,” Rep. Greg Davids, R-Preston, said.

Rep. Steve Drazkowski, R-Mazeppa, said it “pays people not to work.”

“I believe it would make labor disputes last even longer,” Rep. Denny McNamara, R-Hastings, said. “This is taking one side in a dispute and that’s not right.”

Lawmakers added a change Monday that would exclude professional athletes locked out from sports teams from the provision. Those who made $150,000 or more the year before also would not be eligible for the benefits under a change successfully added by Drazkowski.

The bill includes a tax cut for employers, estimated to save them almost $350 million over the next two years.

Mahoney proposes opening three more trade offices throughout the world, bringing the total to four.

Republicans said the bill will hurt businesses and does little to create private-sector employment.

“This is a jobs bill if you believe the government creates jobs,” Minority Leader Rep. Kurt Daudt, R-Crown, said.

The bill also includes housing provisions, such as $32 million for housing programs and $3 million for homeless youth services.

Senate proposes surcharges

Senate Democrats suggest adding surcharges on nursing homes and health maintenance organizations to help make up for a $150 million cut to state health programs ordered by legislative leaders.

A bill unveiled Monday by Sen. Tony Lourey, the Senate health and human services finance chairman, would add an $80 million surcharge on health maintenance organizations and $16 million on nursing homes in the next two years.

The budget also caps how much can be spent on managed care programs, an expected $53 million savings.

The health and human services budget — which mostly goes to provide health care for the poor, disabled and elderly — would top $11 billion. That only is smaller than public school spending in the state’s proposed $38 billion, two-year budget.

In his bill, Lourey, DFL-Kerrick, suggests transferring more than $400 million out of the Health Care Access Fund for other uses.

“Our committee was given a difficult task this session as the Legislature looks for savings within the budget for health and human services,” Lourey said. “This legislation doesn’t represent what I had hoped for as we started this session, but I believe this bill meets its target and still protects our most vulnerable populations.”

Bill increases oversight

Legislators would watch state-run colleges and universities closer under a bill House Democrats support.

The bill, which funds higher education, also would keep tuitions in check and help reduce student debt, House Higher Education Chairman Gene Pelowski, DFL-Winona, said.

“This bill focuses those new resources largely in two areas — tuition and debt — so we can put our resources into areas that directly benefit the students,” said Pelowski, whose bill funds University of Minnesota and the Minnesota State Colleges and University systems as well as a state tuition grant program.

State higher education funding has shrunk in recent years, but the House bill ups spending by $150 million in the next two years

House and Senate committees met separately Monday to discuss their own versions of higher education spending measures. They two chambers offer similar plans, both concentrating on tuition freezes.

The Senate plan would appropriate about $1.2 billion each for the University of Minnesota and Minnesota State Colleges and Universities systems, while the House gives about $1.1 billion each. Total higher education spending would be $2.8 billion for the next two years in the Senate bill and $2.7 billion in the House. Gov. Mark Dayton calls for $2.8 billion.

The full House and Senate plan to vote on their plans in the next couple of weeks, sending the slightly different bills to a conference committee, where the two bills and Dayton’s plan can be merged.

Two years ago, the Legislature made record cuts to the state higher education budget, after several years in which colleges and universities lagged other parts of state government. Tuition has nearly doubled at state colleges and universities in the past decade.

Besides adding money, Pelowski’s bill extends legislative oversight. He said the changes are designed to better hold state schools accountable for budgeting practices that have come under fire for high administrative costs and excessive compensation for top administrators.

“The work in our committee showed a clear need for the Legislature to have a greater role in the oversight of how the U of M and MnSCU are spending public and tuition-raised dollars,” Pelowski said. “We found that administrative costs and salaries are growing at an unsustainable rate and students are paying the price with higher tuition and debt. That is unacceptable.”

Transportation budget rolls on

All Minnesota counties would be able to charge up to $10 each year per vehicle to fund road and bridge projects under the House transportation bill a committee moved forward Monday.

The fee would be paid by vehicle owners when renewing license tabs. Twin Cities metropolitan area counties already can impose the tax, but the bill expands it to include the whole state.

The proposal also would allow counties to impose a half-cent sales tax for transportation projects without requiring residents to vote on it.

“I think this is an important tool in the toolbox for local governments,” Transportation Finance Committee Chairman Rep. Frank Hornstein, DFL-Minneapolis, said. He said the bill would help local infrastructure projects happen.

Both the House and Senate transportation budget proposals were scaled down after Gov. Mark Dayton said he would not support a gasoline tax increase. That left some members disappointed with the scope of the bill.

“It falls woefully short of meeting the well-documented needs” of transportation in the state, Rep. Clark Johnson, DFL-North Mankato, said.

“This isn’t the bill I hoped to put forward,” Hornstein said, but added he thinks there still is time for changes.

“I believe we still have some important opportunities to get it right,” he said.

The $5.19 billion budget over the next two years would fund local road and bridge projects, state construction, transit, airports and other transportation needs.

The Transportation Finance Committee moved the bill forward on a voice vote to the House tax committee.

House DFLers set high education funding goals

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Marquart

By Don Davis

Goals of 100 percent high school graduation, every third-grader being able to read, ending an achievement gap and all students being ready for careers or college after graduation are lofty, but House Democrats say their sights are set on those accomplishments by 2027.

Rep. Paul Marquart, DFL-Dilworth, said Tuesday that the $15.7 billion House Democrats want to spend on education in the next two years would “actually make a difference in the life of every single student of this state.”

The House education financing plan closely follows one released by Democratic Gov. Mark Dayton, but takes a new approach to improve education.

Marquart said schools would be required to submit plans to show how they would achieve the major goals. Once approved by state officials, schools then would be required to make annual progress toward the goals.

If a school did not make good progress in meeting the goals three straight years, the state could step in and maybe even take over a school.

Marquart said state Education Department officials would be the judges about whether schools are making adequate progress.

Schools would receive an additional per-student payment of $104 each of the next two years “to give schools the resources … they need to meet those goals,” Marquart said.

The plan calls for spending $15.7 billion in the next two years, the largest part of a proposed $38 billion budget, a bit more than in Gov. Mark Dayton’s budget plan. The Senate has yet to announce its school budget.

Current education spending is $15.5 billion.

Rep. Kelby Woodard of Belle Plaine, the top House education Republican, said Democrats are off to a good start, but tax increases they propose are not needed to fund schools.

“It is disappointing, however, Democrats propose spending new money to create new layers of government bureaucracy while thrusting even more unfunded mandates on our schools,” Woodard said. “Those are key areas we need to address before we gain wholesale bipartisan support.”

House Speaker Paul Thissen, DFL-Minneapolis, said that education improvements, especially for young children, are “the best way to build a strong middle class.”

Minnesota used to be the top education state, House Majority Leader Erin Murphy, DFL-St. Paul, said. “We have slipped to the middle of the pack in the last 10 years.”

Marquart, House education finance chairman, said his bill would fix the problems Murphy mentioned. He said proven tactics would be used by Minnesota educators, particularly new efforts in early-childhood education.

About $50 million would go to providing scholarships to families with 3- and 4-year-olds to attend public or private preschools, Marquart said. They would need to have incomes less than 185 percent of the federal poverty level to qualify for the state-issued scholarships.

Marquart estimated that 8,000 students would get the scholarships, but that only is a quarter to a third of those who need them. The average scholarship would be $7,400 a year.

Marquart said he expects every Minnesota school district to take advantage of the all-day kindergarten money.

New general money available to schools could be used as districts wish, but Marquart said they would need to use it to reach the main education goals.

The portion of the education plan to require continual progress should be treated like coaching, Marquart said. “It is coaching and working with the excellent staffs in the state.”

Proposed $150 million health cuts surprise, anger lawmakers

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Huntley

By Danielle Killey and Don Davis

Elderly and disabled Minnesotans likely would be most hurt by proposed cuts to the state’s health and human services budget that caught many lawmakers by surprise, some advocates say.

Budget outlines House and Senate Democratic leaders released this week propose cutting about $150 million from the human services budget.

“That’s a very ugly scenario,” Senate Health and Human Services Committee Chairman Tony Lourey, DFL-Kerrick, said. “I was very let down.”

Sen. Tom Huntley, DFL-Duluth, said that while the budget is large, at $11.4 billion and second only to education funding, $150 million is enough to fund many needed programs.

“Ninety percent of my budget is seniors getting long-term care and people with disabilities,” said Huntley, the House Health and Human Services Finance Committee chairman. “That’s where most of the money goes.”

Lourey and Huntley, who will work to craft health budget plans, were not happy with the cuts.

“We have a very bad target we got from leadership,” Huntley said.

“It’s about $300 million less than the governor’s (plan),” he added. “That’s going to be very difficult to do.”

Democratic Gov. Mark Dayton’s budget proposes a more than $150 million increase in human services spending.

House Majority Leader Erin Murphy, DFL-St. Paul, said she has confidence in Huntley’s committee’s ability to find efficiencies and ways to trim the budget.

“We need to look at the changing landscape,” Murphy said, which includes expected more federal aid for various health care programs.

Reforming health care programs should save more money, she added, but the state may need to “strategically cut” to reach the $150 million target.

Huntley said one approach could be to create or increase health care-related fees or cut some hospital funding.

“But all that’s going to do is increase health care costs when we should be working to decrease costs,” he said.

Rep. Jim Abeler of Anoka, who chaired the House Health and Human Services Committee when Republicans were in charge the last two years, said that the only pot of money he sees for health funding would be to put a surcharge on Medical Assistance, the Minnesota version of Medicaid.

“There are only some fees they can raise,” he said.

The human services budget is quickly rising due to soaring health care costs and has been a prime target in the past decade as state leaders looked for places to cut.

The Democrats’ proposed cuts surprised Abeler.

“I spent the day with my jaw on the floor,” he said. “I couldn’t have predicted this.”

When Republicans were in control, groups that depend on state health funding expected cuts.

“They are not prepared for it at all,” Abeler said of these cuts, adding Democrats made it clear they would raise taxes to support increased spending in the state budget.

Rep. Mary Franson, R-Alexandria, said she does not have a problem with cuts, but this area actually needs increased funding.

Franson said, especially in greater Minnesota, hospitals and nursing homes are having trouble keeping good employees because of the pay and some people are not getting the care they need.

“They are really struggling,” she said.

Murphy said she expects Republicans to join Democrats in making the changes.

“If they are not willing to make cuts and they are not willing to raise taxes, I don’t know why they are here,” she said.

Health care advocates are pushing leadership to reconsider the cuts, and Lourey said he does not see the numbers as final.

“The targets are just that, targets,” he said. “I’m going to keep working on it.”

All funding committees, including those dealing with health spending, face an April 19 deadline to finish budgets.

 

 

Lawmakers look at way to maintain MinnesotaCare insurance

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Jesson, Murphy

By Danielle Killey

Thousands of lower-income Minnesotans could continue to get health insurance from the state even as major reforms take root under a plan lawmakers moved forward Wednesday.

House Majority Leader Erin Murphy, DFL-St. Paul, said the state needs to update and continue MinnesotaCare, a health insurance program that serves “people who are working but don’t have access to affordable health care.”

“MinnesotaCare’s future is in doubt,” Murphy said, because of changes such as the state’s new health insurance exchange signed into law Wednesday by Gov. Mark Dayton.

Murphy’s bill would make some changes to “modernize” the program and help it meet standards of the Affordable Care Act, also known as Obamacare.

The House Health and Human Services Policy Committee sent Murphy’s bill to the Health Finance Committee on a voice vote.

The MinnesotaCare program would cover those who earn between 133 percent and 200 percent of the federal poverty guidelines, which Human Services Commissioner Lucinda Jesson said is between roughly $15,000 and $23,000 for single individuals.

Those who make less typically are part of the state’s Medicaid program.

If the state did not keep MinnesotaCare, those in that income range would need to choose a commercial health insurance plan and use subsidies, such as federal tax credits.

“This has been so valuable to many people in the past,” Jesson said of MinnesotaCare. About 130,000 people use the program now.

Advocates said the MinnesotaCare program is a better fit than typical health insurance plans for people in that income range.

Paul Sobocinski of the Land Stewardship Project said his organization often works with young people who are just starting out in farming.

“Health care is an issue for beginning farmers,” he said.

Sobocinski said the MinnesotaCare program is a better option for those people because of the coverage available for the cost.

National Alliance on Mental Illness Minnesota director Sue Abderholden said MinnesotaCare offers better mental health care and that is critical for lower-income people.

“There is a link between mental illness and poverty,” she said.

Jesson said the program’s health insurance premiums are overall less expensive than those that are likely to be part of the health insurance exchange. The deductibles for coverage also are lower as well, which she said could encourage more people to visit doctors or hospitals as needed.

Murphy’s bill would make some changes to the existing program, such as eliminating the $10,000 yearly cap on hospital expenses.

The commissioner said the new mostly online health insurance marketplace process planned to start in October could help some people not on MinnesotaCare find out they are eligible for the program.